3 Common Problems Your Startup Will Probably Face -- And How To Deal With Them

If you’ve been involved in the startup scene for any amount of time, you’ve probably already noticed just how many hurdles startups have to struggle through. The reality of building a business in the age of the modern consumer, whether it’s SaaS or dropshipping through a wholesaler, is that while there’s plentyof opportunity, there’s just as much competition. That means staying ahead of your competitors relies onhow effectively you’re able to overcome those challenges and make your business profitable.

And just to be clear, the odds are stacked against you. The problem with startup failure is that it’s,not just commonplace -- it’s expected. Believe it or not, 90 percent of startups don’t even survive longer than three years. Successfully creating and growing a startup successfully requires lots of time, effort, money and energy. But the truth is that even with all of this, you can still lose if you don’t know what you’re doing.

That’s why today, we’re going to take a look at the biggest problems that startups have to deal with. By the time you finish this article, not only will you be aware of the startup scene’s biggest traps to avoid, but you’ll also know how to ensure that your startup stays one step ahead of the competition.

1. Lack Of Market Understanding

There’s no easy way to say this, so I’m just going to say it. The reason that most startups fail is that,they convince themselves that there’s a need in the marketplace that simply doesn’t exist. Or just as problematic, they convince themselves that a need is drastically higher than it actually is.

You can’t build a business around something that people don’t want. While it’s easy to look at interesting or downright revolutionary ideas and imagine a future market for them, there’s no getting around the fact that if people don’t want it, no amount of business savvy or marketing genius is going to change that.

Fortunately, the solution here is relatively simple. Adopting a more lean approach, startups should aim to collect reliable data on their market demand and how badly people want their product. Or to put it simply, instead of building 100 products and hoping to sell them all, build 5 and make sure they all sell.

Once you’ve sold that first 5, build and sell 10. Scaling slowly is one of the easiest ways to build a sustainable profit margin and ensure there’s truly a need for your product.

2. Generalization Over Specialization

If you’re confused about what I mean here, think about how the average startup describes their service or product. More often than not, you’ll hear the phrase “it’s the Uber of XYZ,” which should immediately be a red flag.

When it comes to building a business, less is more. The idea that your product or service should contain every possible bell and whistle under the sun isn’t just excessive -- it’s distracting and problematic.

Don’t try to serve everyone’s needs at once. Even Google was just a search engine once. Make specialization a priority and avoid generalization like the plague.

3. Money

This is arguably one of the biggest reasons that startup companies fall apart, but it’s important to understand the context here. Is it difficult to get VC funding? Sure, getting Series A money is getting harder and harder every day. But that’s not really what forces startups to close their doors for good. Truth be told, if your business couldn’t survive without an influx of cash, then you were already in trouble from the start.

Businesses require financial support; everyone knows that. But the support should initially start internally. Or to put it simply, your business needs to make money before it can be considered a successful business. Is your product or service actually selling? If not, it may be time pivot and seriously consider trying something else.

And if you do need to pivot, there’s no shame in that. Netflix used to send people DVDs in the mail -- it’s never too late to change your approach, especially if it’s not working for you. Beyond that, there are other ways that you can responsibly cut down on costs. Hire reliable freelance workers, share office space… you get the idea.

At the end of the day, the most useful piece of advice that I would give to startups is also the simplest: make purchasing decisions based on what your budget is, not what you’d like it to be or where you expect it to be. The truth about running a startup is that it’s a minefield where one mistake can mean the end of your business. But while it can be difficult to come out on top in this environment, nothing is saying it’s impossible.

Focus on understanding your market as deeply and accurately as possible. Prioritize specialization within your startup and ensure that you are the perfect solution to one specific problem. And above all else, respect your budget and understand that today’s profits are just as important as tomorrow’s.